‘Food import ban harmful for both the EU and Russia’

Russia's neighboring countries such as Lithuania, Finland, and Denmark will suffer the most from the sanctions as their exports are largely dependent on Moscow, Lianne Van Den Boss food analysts at Euromonitor told RT.

RT:You are saying Germany will be hardest
hit initially by what’s happening here, by these Russian
countermeasures, but still will not suffer as much as other
players, how do you think it’s all going to turn out then?

Lianne Van Den Boss: So in terms of actually the
absolute losses that we are seeing here obviously Germany as
Europe’s largest economy, and are one of the worst hit markets.
However, if we are looking at the total exports of Germany to
Russia, they are actually not that high, so [Berlin] is not that
much relying on Russian imports. It is just a few percent of
their total exports. Other countries, and mostly neighboring
countries such as Lithuania or Finland, Denmark, it’s a much more
important market for them. For example Arla has announced that
because of the sanctions they are expecting redundancies in the
biggest market in Denmark, because they are investing a lot in
Russia at the moment, it is one of the fastest growing cheese
markets. Obviously that is very important for Arla and we are
expecting Russia to be the third largest cheese market in the
next few years. So depending per country, the effects are more or
less depending on the reliance on exports.

RT:Earlier you mentioned Finland. Well in a
report last night, it said it would be hard hit and the prognosis
is that it could take up to ten years for it to recover.

LB: I am not really sure about duration. It all
depends on how long the sanctions are going to last. Obviously,
both partners, both for the EU and for Russia, it would be much
better for this ban to be lifted. In Russia, they are expecting
prices [to grow]. In short term, they might actually not go up
because they cannot really substitute all these products that
quickly whilst in Europe we are seeing [where they are] obviously
being over produced, and especially when it comes to fresh
products, these need to find a destination market quite quickly.

RT:President Putin said the Russian ban will
be in place for 12 months, Danske Bank said that might not be the
case, if this plays slightly differently, but either each way,
couldn't Europe see this coming?

LB: We have seen signs in the past. For example
Polish pork has been banned and this was after discussions that
Poland wanted heavier sanctions on Russia. Or the scene where the
US chain McDonald’s, they were fined or sued by Russia because
apparently they were not properly abiding with Russian health
laws. So we are seeing signs and one could suggest that, indeed.

RT:Will the European firms really be
allowed to trade in Russia again?

LB: You make a good point, especially if they
are looking for new import partners in this case. Russian
consumers might get used to brands that have been imported from
non-embargoed countries. However this is rather short term. Over
the long term, obviously consumer would still want to purchase
cheese originating from France. In the long term I think this
might go away, but in the short term it is definitely something
to consider.